Payment to MSMEs vendors

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This query is : Resolved

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A Sector Skill Council in India, which partners with Training Partners and Assessment Agencies, is seeking advice on payment delays to MSME-registered vendors. The council receives payments from government departments for training programs and then pays its partners, deducting its share. The core issue is whether they can withhold payments to MSME vendors until they themselves receive funds from the government, or if they risk incurring interest on delayed payments. They are also considering if MSME vendors can be asked to raise invoices only after the council receives payment.

ashu gupta

ashu gupta (Querist)
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10 May 2023 Hi,

We are a Sector Skill Council of India and our business is to give training to the candidates under electronics job roles. We don't do it ourselves. There are Assessment Agencies and Training Partners who are affiliated with us and do this work on our behalf.

For a particular training, we receive our payments from the respective govt. dept. and after that we have to pay to our Assessment Agencies after deducting our share. Some of the Assessment Agencies are registered under MSME act.

My concern is can we hold the payment of these MSME until we get the payment for that training because our policy is that we've to release the payment only after getting our payments from the govt. but sometimes we don't get payment on time.

So in that case can we delay payment of MSMEs until we get our payment or we've to pay interest on delayed payment to MSMEs. Please suggest what is the solution in this case?

Regards